I have developed a long term investment strategy using RSI, super trend and volume scanner.
And it is back tested with very impressive returns and an Expectancy (L) value of 1.7.
Then, What is the problem?
The problem is that I am scanning this scanner on nifty 750 basket and each week I am getting 3-5 stocks.
Now as I progress my investment basket size increasing and I don't want to go beyond 20 stocks.
Please help me in with some fundament filters which I should use to cut shout my basket.
Should I reduce my scanning basket to say Nifty 500.
Primarily I am more comfortable in technical analysis but I feel for long term portfolio I need to look for fundamental scanners too.
Nifty 750 is a good universe to select stocks for the long term as it will also include micro-caps,
you can use the below query to identify fundamentally good companies:
D/E < 1 AND
ROCE 5yr Avg > 20 AND
NPM 5yr Avg > 6 AND
Net Profit 5yr CAGR > 15 AND
Net Profit 5yr CAGR > Sales 5yr CAGR AND
PEG < 2